The madness on global financial markets is continuing as Reddit group WallStreetBets refuses to give up its fight against the hedge funds. Last week trading in GameStop shares (GME) saw the mainstream media sit up and take notice hedge funds lost millions. The little man was winning for a change, and those without a dog in the fight were loving every minute.

Is the Silver Market the next Target?

The latest price that is getting everybody’s attention this week is that of silver. The precious metal surged 13% on Monday to an eight-year high. Is the Reddit community trying to create a second front?

There was a small discussion on the WallStreetBets thread regarding a theory that investment banks are artificially suppressing the price of silver. This set tongues wagging over whether or not this was the best investment of the week. Could we see another surge of several hundred percent?

Retail websites that sell precious metals are already informing customers that they cannot meet demand. This is only after a few days worth of unusual trading patterns.

APMEX, one of the world's largest online retailers of precious metals, wrote on its website:

"Due to unprecedented demand on physical silver products, we are unable to accept any additional orders on a large number of products, until global markets open Sunday evening," 

Conspiracy Time

WallStreetBets members are now opening discussing the possibility of the hedge funds creating this silver squeeze to begin with, as a distraction to the war over the price of GameStop shares. 

Only last year JPMorgan, the largest bank in the United States, paid a fine of $920 million for spoof trading, so underhand tricks are not beyond the main players even when all eyes are on them.

JPMorgan traders repeatedly placed orders and then quickly cancelled them before they were filled. The idea was to fool the market into thinking there was more demand than there actually was.

A post on WallstreetBets read:

“The media, Wall Street, normies, and every other non-WSB autist are trying to push you to buy silver. This would be a tragic, irreversible decision that not only will most likely not make you any money because the squeeze is fake, it will put you on the sidelines from this righteous and glorious war we are in.”

The Crowd Is Inspired

People must wonder just when all of this madness will stop. The cat is out of the bag, so to speak, and there seems to be enough backing to make movements in the market significant enough to worry the main players. 

The Securities and Exchange Commission (SEC) has already indicated that they will look further into the situation and decide if they think something is illegal. 

Jordan Belfort, the Wolf of Wall Street, has already told the media that the Reddit group WallStreetBets is technically breaking the law. Banding together with the intention of affecting a stock price is against the law in all jurisdictions. He added that it is unlikely anybody will face charges but something might be done in the future to stop this financial vigilantism.

Still clearly enjoying what he was seeing, Belfort sent a warning message out to the Reddit traders during an interview with the BBC:

"You must be so careful because eventually these stocks are going to come crashing back down to earth.

"If you are looking at this as a way to make your living, you'll have to catch a falling knife on the way down. I would urge people to take their chips off the table."